| Abstract: | Estonia, being one of the most diligent students of the neo‐liberal economic paradigm among the Central and Eastern European transitional countries, has declared that private organisations should be given the chance to operate public prisons. This article argues that in spite of the promising perspective of this idea, the transitional context mixed with the complex nature of incarceration services, sets serious limits for a successful application of the initiative. After identifying four key sources of limiting factors of contracting out, which concern political, legal, administrative and economic aspects, the article gives a brief overview of the development of the Estonian public administration and prison system. It is argued that although no political limits could be identified, there exists some legal and most importantly administrative and economic limits for contracting out prisons in Estonia. There is a need to understand that due to problems inherent in transitional countries such as a low administrative capacity and underdeveloped markets, the implementation of contracting out in cases of complex public services does not solve but transfer the essence of the problems. Copyright © 2004 John Wiley & Sons, Ltd. |
